There is an anticipation of a cut to the one-year rate on the People’s Bank of China Medium-Term Lending Facility (MLF) expected Monday. The previous cut was back in January, by 10bps to 2.85%.

• analysts are split on a cut to the rate (to be fair its not a very transparent process and thus very difficult to call)

If there is a cut to the MFL rate it’d indicate a higher probability of cuts to the 1- and 5-year Loan Prime Rates (LPR) coming from the PBOC on the 20th (i.e. Friday this week).

The PBOC has allowed the yuan to depreciate, which should provide stimulus to the external sector (exporters):

Weekly USD/CNH candles.

 eur  cnh